NASDAQ futures are coming into Tuesday gap up after an overnight session featuring a tight [but normal] range on abnormally low volume.
Volume was so low overnight it exceeded 1st sigma, or ‘normal’ conditions. This comes after near two months of normal Globex trading stats.
Price worked higher overnight but held yesterday’s range. Also of note, pertaining to Globex, is our current high water mark. It was set during Globex and the NASDAQ rarely marks swing high/low during the overnight session.
On the economic docket today we have Wholesale Inventories at 10am, a 4-week T-Bill auction at 11:30am, and a 3-year Note auction at 1pm.
Yesterday we printed the dreaded normal day–a rare day type occurring only 5.66% of the time [according to a recent study]. These tend to show up at-or-near inflection points.
We came into the week with a slight gap up and sellers pressed into it. The morning selling abated before the range could be extended and we printed time until the ramping hour, when price did the afternoon ramp.
Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 4779.50. Sellers push down through overnight low 4777.50. Sellers probe below last Friday’s low 4759.75. Look for responsive buying down at 4757 and two way trade to ensue.
Hypo 2 buyers work up through overnight high 4788.50 and test up through the Globex high mark at 4800.75. Look for responsive sellers up at the measured move levels at 4806 and two way trade to ensue.
Hypo 3 strong buyers push up to 4822 before two way trade ensues.
Hypo 4 liquidation takes hold and we test lower, down to 4745.50 and close the gap at 4743.50 before two way trade ensues.
Volume profiles, gaps, and measured moves: